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DECISION
ABAD , J : p
This case is about the power of courts to hear criminal violations of the law that
protects subdivision buyers against developers selling lots before they are issued
licenses to sell and the effect of the subsequent issuance of such licenses to sales that
land developers make before the issuance of their licenses. AScHCD
In ruling that respondents' criminal liability has been extinguished, the CA relied
on Co Chien v. Sta. Lucia Realty and Development, Inc. 2 2 But Co Chien is a case for
refund of down payment and nulli cation of the contract of sale between the buyer and
the developer whose license was issued only after the execution of the contract. This
Court refused to void the transaction in the case because the absence of the license
was not in itself su cient to invalidate the contract. And while there was no fraud on
the part of the developer, the HLURB directed it to pay an administrative ne of
P20,000.00 for selling the lot without the necessary license. This only shows that the
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subsequent issuance of a license, as in this case, will not extinguish the liability of the
developer for violation of Section 5 of P.D. 957.
WHEREFORE , the Court GRANTS the petition and REVERSES and SETS ASIDE
the June 2, 2006 Decision and the August 22, 2006 Resolution of the Court of Appeals
in CA-G.R. SP 90468. The Court REINSTATES the May 20, 2004 Order of the Regional
Trial Court of Quezon City in Criminal Case Q-03-116823, which denied respondents'
omnibus motion to quash and motion for judicial determination of probable cause.
SO ORDERED .
Carpio, Brion, Del Castillo and Perez, JJ., concur.
Footnotes
1. Emancipation Patent No. 446684, rollo, p. 287; and Emancipation Patent No. 446685, id. at
283.
2. Id. at 298.
4. Id. at 111.
5. Branch 83.
6. Rollo, p. 360.
7. Id. at 300.
8. Id. at 132.
9. Id. at 300.
11. Id. at 108. The Order was issued by Judge Ramon A. Cruz.
12. CA rollo, p. 265.
13. Rollo, p. 42, penned by Associate Justice Arcangelita M. Romilla-Lontok and concurred in by
Associate Justices Marina L. Buzon and Aurora Santiago-Lagman.
17. Sec. 5. License to Sell. — Such owner or dealer to whom has been issued a registration
certi cate shall not, however, be authorized to sell any subdivision lot or condominium
unit in the registered project unless he shall have rst obtained a license to sell the
project within two weeks from the registration of such project.
The Authority, upon proper application therefor, shall issue to such owner or dealer of a
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registered project a license to sell the project if, after an examination of the registration
statement led by said owner or dealer and all the pertinent documents attached thereto,
he is convinced that the owner or dealer is of good repute, that his business is nancially
stable, and that the proposed sale of the subdivision lots or condominium units to the
public would not be fraudulent.
18. Sec. 38. Administrative Fines. — The Authority may prescribe and impose nes not
exceeding ten thousand pesos for violations of the provisions of this Decree or of any
rule or regulation thereunder. Fines shall be payable to the Authority and enforceable
through writs of execution in accordance with the provisions of the Rules of Court.
Section 39. Penalties. — Any person who shall violate any of the provisions of this
Decree and/or any rule or regulation that may be issued pursuant to this Decree shall,
upon conviction, be punished by a ne of not more than twenty thousand (P20,000.00)
pesos and/or imprisonment of not more than ten years: Provided, That in the case of
corporations, partnerships, cooperatives, or associations, the President, Manager or
Administrator or the person who has charge of the administration of the business shall
be criminally responsible for any violation of this Decree and/or the rules and
regulations promulgated pursuant thereto.
19. Bouvier's Law Dictionary, Rawle's Third Revision, p. 2066.
20. Go v. The Fifth Division of Sandiganbayan , G.R. No. 172602, September 3, 2007, 532 SCRA
130, 136.
21. Garcia v. Court of Appeals, G.R. No. 157171, March 14, 2006, 484 SCRA 617, 622.
22. G.R. No. 162090, January 31, 2007, 513 SCRA 570.